As we enter the new year, it’s safe to say that the stocks set for huge returns in 2021 will be largely dominated by the pandemic. This is because the return to a new normal remains in the distant future, as the roll-out of the vaccine continues globally.
Stocks that serve the remote economy have come out on top this year. The shift to virtual shopping and entertainment is a trend that will continue well past the pandemic.
The S&P 500 has nearly doubled since its March lows but not all stocks have benefited from this upward run-off. Hence, it is important to pick and choose investments that will continue to produce returns even in a new normal. The three stocks listed below have performed well this year but show promise for bigger returns in 2021.
Stocks Set for Huge Returns: Disney (DIS)
From theme park operator to streaming giant, Disney’s pivot this year is one for the books. With movie theatres shut for much of this year, people looked for alternative avenues for entertainment.
Disney’s online entertainment platform, Disney+ catered perfectly to this trend and did wonders for its stock price. Shares are up 20% this year with room to higher in the coming months.
Looking ahead, Disney is looking to pull out all the stops on Disney+. The company anticipates that its total subscribers will hit 260 million by 2024. A huge driver for this will be its low cost and slate of films.
A subscription for Disney+ starts at just $7 which is lower than competing entertainment platforms. Adding to this is the impressive line-up of films Disney owns. Prior to Investor Day in December, the company announced 100 new movies and tv-series that will be heading to Disney+ next year.
Analysts are predicting some strong results for Disney+ in the coming years. If the platform keeps its current momentum going, these expectations will come to fruition sooner than later.
Shopify (SHOP)
Another segment of the market that saw some monster results this year is e-commerce. With forced closures in early 2020, many businesses made the pivot to the digital world.
The online platform, Shopify played a key role in helping businesses do this. As a result, its shares are up by 195% this year. However, experts believe this one of the stocks set for huge returns in 2021, even after in-store shopping returns.
There are two major reasons for its reigning success. One, Shopify serves as a great alternative to Amazon (NASDAQ:AMZN) that controls a massive share of the North American market. This, coupled with a growing number of businesses on its platform, will keep Shopify in the limelight in 2021.
Adding to this is the changing trends in e-commerce. In just one year, the company’s market share increased from 11% to 14%. This impressive surge makes SHOP stock a great buy even if sales dip in a post-pandemic world.
Experts estimate that direct-to-consumer sales will rise in the coming years putting Shopify in a great position to benefit from this trend. Given the success of e-commerce this year, there is also a good chance of a permanent shift in the way people shop for goods and services.
Pfizer (PFE)
Pfizer had a slow run for the last two years but has turned things around and is now one of the top stocks set for huge returns in 2021.
The company refocused its attention on its Consumer Healthcare segment which has a huge potential for growth. Through a combination of savvy business moves that involve the development of new drugs and the acquisition of smaller brands, Pfizer will keep its revenue flowing. The pharmaceutical company predicts annual growth of 6% till 2025.
Adding to its impressive lineup of branded drugs, Pfizer will also see some massive gains from the sales of its Covid vaccine. As the first company to develop a successful vaccine against the virus, Pfizer will play a key role in a return to normal life.
The company secured multiple distribution deals with the U.K., Japan and the U.S. to name a few. The potential for future revenue is largely dependent on the speed at which the vaccine is produced and distributed. If Pfizer can keep up the pace, it will look at an 11-figure sales value in 2021.
A Covid-vaccine sales bump is reason enough to bet on Pfizer stock in 2021. However, the growth of the consumer drugs segment and high dividend makes it a great buy for long-term investors.
On the date of publication, Divya Premkumar did not have (either directly or indirectly) any positions in any of the securities mentioned in this article.
Divya Premkumar has a finance degree from the University of Houston, Texas. She is a financial writer and analyst who has written stories on various financial topics from investing to personal finance. Divya has been writing for InvestorPlace since 2020.
